President Bush is meeting with German Chancellor Angela Merkel Wednesday as part of his farewell tour of Europe.

One of the main topics for discussion is preventing Iran from developing nuclear weapons. The President says his first choice is to resolve the issue diplomatically, but he reinforced the idea that a military strike against Iran is still a possible last resort.

"I told the chancellor my first choice, of course, is to solve this diplomatically," Bush said during a news conference with Merkel. He quickly added, "all options are on the table."

Bush also warned Iran that the international community won't back down until they stop their nuclear program.

"Iran with a nuclear weapon would be incredibly dangerous for world peace," Bush said. "We're going to continue to isolate you. We'll continue to work on sanctions. We'll find new sanctions if need be if you continue to deny the just demands of a free world which is to give up your enrichment program."

Iranian President Mahmoud Ahmadinejad on Wednesday said Bush's era "has come to an end" and he has failed in his goals to attack Iran and stop its nuclear program.

The Iranian leader said that pressures and sanctions won't succeed in forcing Iran to stop its enrichment of uranium. "If the enemy thinks they can break the Iranian nation with pressure, they are wrong," he said.

Iran insists it is enriching only for peaceful purposes.

But Merkel said if Iran does not agree to suspend its enrichment program, additional sanctions would be needed.

"The offer has been put on the table to Iran, but. if Iran does not meet its commitments, then further sanctions will simply have to follow," she said.

Europeans want to wait on stiffer sanctions until after the European Union's foreign policy chief, Javier Solana, visits Tehran to present a package of incentives in exchange for stopping its enrichment program.

The offer, a revised version of the one Iran snubbed a few years earlier, was developed by the United States, along with Germany, Britain, France, Russia and China.

Later this week, Bush plans to continue talks with Merkel and other EU leaders to work together against Iran.